# Deposits and government bonds > Government bonds (OVDP) and a term deposit compared side by side on the four questions for any place to keep savings: rate, tax, guarantee and access. - Course: [Personal Finance: Budget, Safety Cushion, Debt and Investing](https://productovi.com/courses/personal-finance.md) - Module: Where should savings live? - Lesson 19/32, ~17 min - Source: https://productovi.com/courses/personal-finance/deposits-and-bonds ## What are government bonds? Four questions **Alex Tutor:** You're still helping Dana with her savings, and today Hanna from Klasna's finance team joins in. **Dana:** Hanna from finance says she keeps her savings in government bonds, not deposits. I asked why and got lost after the second sentence. **Hanna:** Let me try again, slower. I ask any place for savings four questions: what rate, what tax, who guarantees it, and how fast I can get the money out. Deposits and bonds answer them differently. **Hanna:** **Government bonds**, ОВДП in Ukrainian (domestic government loan bonds), are a loan you give the state for a fixed term, repaid with interest. The "military bonds" are ОВДП too. In late September 2026, hryvnia bonds for individuals paid roughly 15–17.5% a year, and 12-month deposits at big banks about 13–14%. **Hanna:** Then tax. As of September 2026, the bank keeps 23% of deposit interest. Interest on government bonds is free of both personal income tax and the military levy. **Alex Tutor:** So comparing 16% with 14% isn't fair to the bond. Turn it around: what rate would a deposit need before tax to leave you the same 16%? > **Exercise:** A hryvnia government bond pays 16% a year with no tax. Deposit interest is taxed at 23%. What rate **before tax** would a deposit need to leave the same 16% after tax? In %, two decimals. ## Deposit guarantee: who stands behind the money **Sofia:** 20.78% before tax. No 12-month deposit at a big bank pays that. So the bond wins on rate and tax. **Hanna:** On those two, yes. Now the guarantee. Deposits, card accounts and current accounts of individuals and sole proprietors are covered by the **deposit guarantee**: if a bank fails, the state Deposit Guarantee Fund pays depositors back. **Hanna:** As of September 2026, during martial law and for three months after it ends, the fund repays deposits in full. After that, the limit is 600,000 UAH per person in each bank, all accounts in that bank together. **Dana:** And dollar deposits? And the bonds themselves? **Hanna:** Dollar deposits are covered, but paid out in hryvnias at the official rate. Bonds aren't covered by the fund at all: they're a debt of the state itself, recorded in a separate securities account, not on the bank's balance sheet. > **Exercise:** As of September 2026, which of these are covered by Ukraine's deposit guarantee? Select all that apply. ## Buying in whole bonds **Dana:** How do I even buy a bond? Is there a minimum? **Hanna:** Through a bank's app or a licensed broker. One bond has a face value of 1,000, in hryvnias, dollars or euros, and you can buy just one. The price is often a bit above or below 1,000, depending on the issue and the day. **Alex Tutor:** Say an issue costs 1,025.50 per bond, and Dana has 150,000. She can only buy whole bonds. How many? **Sofia:** And whatever doesn't fit into a whole bond stays on the account. > **Exercise:** A hryvnia bond issue costs 1,025.50 UAH per bond, and only whole bonds can be bought. **How many bonds** does 150,000 UAH buy? ## Getting the money out early **Dana:** 146 bonds and 277 left over. Last question: what if I need the money before the end? **Hanna:** That's where they differ most. Close a **term deposit** early, and you usually lose part of the interest; some deposits can't be closed early at all. Read that line before signing. **Hanna:** A bond can be sold before it matures, even one at a time, but at today's market price, not at what you paid. The price can be lower, and the bank buys a little below the price it sells at. **Alex Tutor:** So both work best when the term matches the goal. Pick a bond that matures shortly before you need the money, and the price in between stops mattering. > **Exercise:** **True or false:** if Dana holds a government bond until it matures, she knows in advance what she'll receive, even if the bond's market price falls in between. ## When the guarantee has a limit **Sofia:** Dana's 150,000 is far below 600,000. Does the limit even matter? **Hanna:** Not for her today. It matters when savings grow, or when a family puts everything in one bank. Two banks double the covered amount. **Alex Tutor:** And the date matters: "after martial law" is not a fixed day. Rules like this change, so check the fund's current terms before relying on them. **Alex Tutor:** Try one: once the 600,000 limit applies again, someone has 750,000 on deposits in a single bank. How much is not covered? > **Exercise:** Once the post-martial-law limit of 600,000 UAH per person per bank applies, someone keeps 750,000 UAH on deposits in **one** bank. How much is **not covered** if that bank fails? ## Your turn: one card, two options **Dana:** Can I have all of this on one card? Four questions, deposit on the left, bonds on the right. **Hanna:** Good idea. And add a line on who each one suits. Neither is better for everyone. **Sofia:** With numbers where we have them, and a date on the numbers. **Alex Tutor:** Yes. Rates from September 2026 will be stale by spring; the four questions won't. > **Exercise:** Make Dana's comparison card: a 12-month hryvnia deposit vs hryvnia government bonds, one line each for rate, tax, guarantee and access (with numbers and their date where you have them), and one line on who each suits. Late September 2026 figures: 12-month deposits at big banks pay about 13–14% a year with 23% tax on interest, and closing one early usually costs the interest; hryvnia government bonds pay roughly 15–17.5% with no tax. > **Key ideas** > > - Ask any place for savings four questions: rate, tax, guarantee, access. > - **Rate and tax** (late September 2026): 12-month deposits at big banks about 13–14% with 23% tax on interest; hryvnia government bonds roughly 15–17.5% with no tax. A 16% bond equals a 16 / 0.77 = **20.78%** deposit before tax. > - **Guarantee** (as of September 2026): deposits and accounts of individuals and sole proprietors are repaid in full during martial law and for three months after it, then up to 600,000 UAH per person per bank. Dollar deposits are paid out in hryvnias. Bonds aren't covered by the fund: they're the state's own debt. > - **Access**: closing a term deposit early usually costs interest (some can't be closed); a bond can be sold early, but at the market price. Match the term to the goal. > - Bonds come in whole units of about 1,000: at 1,025.50, 150,000 buys 146 bonds with 277 left. Check current terms; this is educational, not personal financial advice. **Alex Tutor:** Next, the case: Dana's 150,000 for a kitchen two years away, with every option, tax and inflation on the table. - Previous lesson: [Hryvnia or dollars: the currency of a goal](https://productovi.com/courses/personal-finance/currency-of-a-goal.md) - Next lesson: [Case: where to keep Dana's savings for two years](https://productovi.com/courses/personal-finance/two-year-savings-case.md) --- Productovi Learning. Free, no sign-up needed to read.